However, Russell Shaw, chief executive of the station's operator Top Energy, said the reports were false.

"There's been a gas leak, there's been no explosion. We have a safety valve on our pressure vessels.

"That safety valve operator sensed over-pressure and ... about 5.30am this morning, the operator, who's the only person on site, shut the station down and evacuated the station.''

"He called the Fire Service who then did a controlled re-entry on the site and to test to see if any gas had been released.''

The Fire Service had been carrying out tests since 6am and were due to leave the site by 7.30am, Mr Shaw said.

"They've found at this stage no release. The station holds 30,000 litres [of gas] so if it had gone up in a big puff of smoke then 30,000 would have been released, but at this stage they've found nothing.

"That is the latest report that we've had from our plant manager.''

The safety valves had never gone off before and it was unknown what had caused it to happen today, Mr Shaw said.

"At this stage we don't know and as a precautionary process, because the gas is highly flammable, if we have a release, we evacuate our operators from site and we go through this process of a controlled re-entry.''

A full investigation would be carried out to determine why the safety valve had gone off, he said.

Mr Shaw told TVNZ that the site was relatively close to the Ngawha village settlement and the company would be working with them to let them know what had happened.

• Pentane is highly flammable and mixtures of the vapour with air can be explosive.

• It is also used as an ingredient in petrol, as a solvent and to fill plastic foams.

Ngawha Geothermal Station:

• First commissioned in 1998

• The station's output is fed into Top Energy's network and then connected to the National Grid via Top Energy's sub-station near Kaikohe.

• The station consistently produces around 70 per cent of all electricity consumed in the Far North, which reduces the community's exposure to possible National Grid failures to the south.

• It uses geothermal fluids which are passed through a heat exchanger where energy (heat) is transferred to a working fluid (pentane). The pentane then boils to form a high-pressure vapour which then drives the turbines, turning the generator.

• When the vapour has passed through the turbines, it is condensed back to a liquid and returned to the heat exchanger in a continuous cycle. The pentane is not consumed as a fuel, but is simply used as a working medium to extract energy from the geothermal water and steam.